The new withholding tables for tax year 2018 are included in our news article entitled,
Withholding Tables for 2018, dated January 15, 2018. These withholding tables are based
upon the new tax rates under the Tax Cuts and Jobs Act, signed into law on December 22,
2017. The IRS recently issued additional guidance on the withholding rules for tax year
2018.

Guidance for employees exempt from withholding. An employee may claim exemption from income tax withholding if he or she certifies on Form W-4, Employee's Withholding Allowance Certificate, that:
1) The employee incurred no income tax liability for the preceding tax year, and
2) The employee anticipates that he or she will incur no income tax liability for the
current tax year.

Under the new guidance, a 2017 Form W-4 claiming exemption from withholding for the
2017 tax year may be treated as effective for any wage payments made through February
28, 2018.

For an exemption from withholding for the 2018 tax year, the IRS will allow employees
to use the 2017 Form W-4 until 30 days after the 2018 Form W-4 is released in one of the
following ways:
1) Modifying the 2017 Form W-4 by striking "2017" in the text on line 7 and entering "2018"
in its place and signing the form in 2018,
2) Modifying the 2017 Form W-4 by entering "Exempt 2018" on line 7 and signing the
form in 2018,
3) Using the 2017 Form W-4 without modification and signing the form in 2018, provided that the employer establishes and communicates to employees a procedure under
which an employee signs and furnishes the 2017 Form W-4 in 2018 to certify both that
the employee incurred no income tax liability for 2017 and that the employee anticipates that he or she will incur no income tax liability for 2018 and thus claims exemption from withholding for 2018, or
4) Any method substantially similar to (1) – (3) above that clearly conveys in writing an
employee's intent to certify his or her exemption from withholding for 2018.

Employees who claimed exemption from withholding for 2017 and are renewing claims
for exemption from withholding for 2018 need to furnish their Form W-4 to the employer
under these revised rules by February 28, 2018. If a 2017 Form W-4 is used to claim exemption from withholding for 2018, the employee does not need to submit a new 2018 Form
W-4 once that form is released.